Knox County budget committee gives preliminary approval to 2025 budget amid staffing and reserve concerns

Knox County’s joint budget committee and county commission gave preliminary approval to the proposed 2025 county budget on Oct. 31, after hearing departmental presentations and debating the impact of rising personnel costs, shifting technology budgets and declining federal grant support.

The vote followed a night of departmental reviews and procedural business, including elections of budget committee officers and a motion to table an appointment to District 8. The chair opened and closed a public hearing on the budget after no members of the public spoke.

Why it matters: committee members said rising wages, insurance and mandated benefits are the main drivers of the county’s increase in personnel costs, while reductions in federal grant funding have pushed some operating expenses onto the county. Airport security and the end of CARES Act support were highlighted as areas where local taxpayers may face new costs unless federal funding returns.

What the committee heard: a spokesperson for the county’s public-safety budgets described two primary wage drivers: the Consumer Price Index for urban wage earners used locally (CPI-W) at about 2.9% and a standard 2% step increase for many employees, which together amount to roughly a 4.9% personnel cost pressure per eligible employee. Health insurance and workers’ compensation were each projected to rise by about 10%, and a new state family medical leave requirement was estimated to add roughly 1% in employer costs.

Departments and presentation format: staff said they are presenting department-by-department in the first sessions and will give a consolidated overview later, when final numbers arrive from finance. Several members asked finance to show total expenditures before applying undesignated reserves so the committee can more easily compare year-to-date spending to budget totals.

Undesignated funds and reserves: the group discussed how undesignated fund balances are shown in budget documents and reminded participants of audit guidance that generally recommends keeping undesignated reserves at or below 20% of certain fund balances. Finance staff said the year-end undesignated balance is still a moving target and committed to providing clearer displays of total expenditures and reserve uses.

Stipends, overtime and retention: members reviewed stipend lines that were added last year as temporary retention payments during a staffing crisis. Committee members said some stipends were incorporated during emergency periods and interacted with union negotiations; several lines remain on current budget reports and staff said some stipend payments have been converted into wage adjustments since contract ratification. Overtime projections rose in some lines (one line showed roughly a 50% increase year to date), prompting questions about whether the budget anticipates sustained staffing shortages or short-term pressures.

IT, GIS and communications shifts: county staff presented a change that moves geospatial (GIS) work out of Emergency Management Agency (EMA) and into administration, and separated IT into its own program to show greater transparency in technology spending. Communications staff said they increased insurance on radio and tower equipment for leased tower sites after consulting vendors; they emphasized that the county does not own many towers and leases equipment space.

Airport finances and solar project: airport staff said CARES Act funding has ended, leaving some costs to the county, but a solar project scheduled for completion this year is expected to generate credits and some future utility savings for airport facilities. Staff said consultants provided revenue estimates for SOAR credits and the county is awaiting updated projections and FAA guidance on potential uses of solar credits.

Airport security: county officials described the current federal requirement to provide law-enforcement coverage at the airport as an unfunded mandate. Committee members discussed whether to charge the air carrier (Cape Air) more to recover security costs; staff cautioned that raising fees can reduce the federal subsidy that helps fund the carrier. One member noted the FAA allows assessing carriers, but that any fee increase must be balanced so it does not risk losing the subsidized service.

Actions and outcomes: the committee approved the minutes from the Dec. 14, 2023 meeting (vote recorded as 7–0), elected Bob Duke as budget committee chair (recorded as passing with six yes votes and one abstention), named Michelle Levasseur vice chair and appointed Nick as secretary by voice votes, and moved to table the District 8 appointment of Douglas Erickson until the next meeting. After departmental reviews the committee and commission moved and seconded preliminary approval of the 2025 departmental budgets by voice votes; several department votes on the commission side were recorded as "2 in favor, none opposed." The committee scheduled further review at the next joint meeting on Nov. 7.

What’s next: staff said a consolidated overview will be provided when the finance director finalizes numbers and closes a few outstanding projects; the next joint meeting is set for Nov. 7 where departments including Knox Clinic, Probate, Deed, Restorative Justice, District Attorney and sheriff-related budgets will be reviewed.

Quotes: "We're not here to answer questions regarding the budget; it's simply if anyone wants to speak about the budget in any way, this would be the time to speak," the chair said when opening the public hearing. Committee member noted the jump in assessed values: "In 2022 the actual tax assessment was 4,640,000. It's up over 7 — it's at 7,004,000," a point used to underscore concern about recent increases. On airport security, an elected official said, "that is now just an unfunded mandate," stressing the funding gap and pressure on county budgets.

The committee adjourned after preliminary approvals and the chair reminded members of the Nov. 7 joint meeting.